Following a number of disputes over scope of work, allegations of delays, and ultimately a claim of wrongful termination, Alaska civil contractor and excavator Weber, Inc. filed a Miller Act claim against the US Army Corps of Engineers’ Missile Field No. 4 Project at Fort Greely, Alaska on September 1, 2021.
The project at hand includes “all of the infrastructure” associated with the construction of the missile field, which includes silo liners, foundations, utilidors, and associated piping.
Weber’s case involves contractors Neeser Construction, Inc. and Miranda Electric, Inc., with Neeser Construction serving as the project’s general contractor and Miranda Electric serving as an electrical subcontractor which in turn hired Weber.
The claim is for a total of $1,173,274, with additional fees to be decided on at a later date. However, at the time of filing, the case remained in arbitration with Miranda Electric, leaving a possibility that the dispute may be resolved otherwise.
According to Weber, it entered into a contract with Miranda Electric in late 2018 outlining that Weber would “perform certain excavation, placement of bedding, and backfill of MEI’s electrical trenching on the Project.”
Weber markets itself as not only a civil contractor, but also a specialist in hydro excavation services — noting that its work “uses pressurized water or air to loosen the soil and a vacuum source to remove the slurry or debris,” leading to “clean, efficient, accurate excavations which require less backfill, less man power [sic], less restoration, and less environmental impact than conventional digging methods.”
The company notes that its scope of work was set out in an October 1, 2018, quote to Miranda Electric, and that its subcontract fully “defined the inclusions, exclusions, and parameters” of what Weber was expected to do.
“Scope of work” is an aspect of construction contracts that specifies the work that is to be performed on a construction project. As Levelset’s Alex Bennaroche notes, “A well-written scope of work sets the expectations for both parties, including the responsibilities, milestones, and technical details required to complete the job.”
However, Weber claims that despite these very specific parameters, Miranda Electric directed it to perform what it calls “significant excess excavation of the trenches included in Weber’s Scope of Work, as well as excavation and backfill of vaults and sumps and the screening of backfill” — duties which, Weber says, are all beyond the scope of the actual subcontract.
Despite this alleged overreaching, Weber says that it agreed to perform the additional work based on the assurance that Miranda Electric would pay for all items requested outside the subcontract.
Following this extra work, however, Weber claims that it was unexpectedly terminated by Miranda Electric on September 3, 2020, “based upon unsupported allegations of delay.”
The company notes that delays did occur, but maintains that they were the fault of others involved in the project, stating in its claim that it was held back by Miranda Electric’s “failure to provide Weber with the information Weber repeatedly requested and required in order to perform the work, as well as the failure of other contractors/subcontractors to perform the predecessor work necessary for Weber to work.”
This was not the end of the on-site issues between the two companies, either. Weber claims that “After wrongfully terminating Weber… [Miranda Electric] punitively insisted upon holding Weber’s equipment, preventing Weber from utilizing the equipment even though MEI barely used the equipment before releasing it back to Weber on January 7, 2021 after repeated demands by Weber for its return.”
According to the filing, Weber first provided Neeser Construction with notice of its Miller Act claim on October 6, 2020, and added supplemental and amended notices on December 16, 2020, and February 8, 2021, making the process a lengthy one for the company — and displaying just how drawn out the arbitration process has been prior to the company’s claim.
The dispute is surely one that the involved parties — and particularly the US government — would like resolved soon.
US Army officials are holding the project in high regard, with a November 2020 visit from Lt. Gen. Daniel L. Karbler, commanding general of the US Army Space and Missile Defense Command, underscoring its importance.
“The Missile Field 4 construction project is incredible,” Karbler said at the time. “I was briefed by the contractors, the Army Corps of Engineers, the Missile Defense Agency and the other partners out there who are working in such an extreme climate…I saw a high spirit of teamwork and cooperation to keep construction on schedule, despite the conditions.”
As Alex Bennaroche’s coverage for Levelset notes, Alaska has a number of protections in place for contractors who work on public projects, even outside of the Miller Act. Though the federal Miller Act protects in the case of such projects as the Fort Greely missile construction, many states also have enacted similar laws — often called “Little Miller Acts” — in order to protect contractors.
Bennaroche notes that Alaska’s “Little Miller Act,” recently clarified by the Alaska Supreme Court, covers “any work that is ‘necessary to and forwards’ the project,” making “project participants, such as supervisors and design professionals,” now easily able to make a claim on a public project in the case of any dispute or non-payment.
With significant government infrastructure spending on the horizon, Miller Act claims may rise in frequency
This isn’t the only time that Miller Act claims have come to the forefront of construction news. As recent Levelset coverage has focused on, there have been a number of significant such claims involving US military facilities in recent months.
April 20, 2021, saw Washington State-based contractor Harris Pacific Northwest, LLC file a Miller Act claim against a Bremerton, Washington United States naval base, alleging non-payment of $3.16 million stemming from its work as a subcontractor participating in the facility’s seismic upgrades.
Similarly, after performing work on the NAVFAC Naval Station Guantanamo Bay Cuba W.T. Sampson School, July 2021 saw Florida-based electrical contractor Ion Electric LLC file a Miller Act claim seeking nearly $10 million in non-payment.
There’s a good chance that a potential increase in major government spending will impact this, as well. Though the timeline for completion of a deal may be held back by governmental desire for an agreement on a controversial overall $3.5 trillion economic package, the US Senate has already approved a $1 trillion infrastructure package that would lead to major spending in construction over the next decade.
The package will include $550 billion in new spending for public works projects, with $110 billion for highways, $65 billion for broadband, and $73 billion to modernize the nation’s electric grid alongside $25 billion in funding for airports, $55 billion for waterworks, and more than $50 billion intended to prop up infrastructure against cyberattacks and climate change.